Big Game Development Company Botswana (Pty) Ltd and Another v De Kock and Another (civil Appeal No. 21 of 1995) [1996] BWCA 27; [1996] B.L.R. 145 (CA) (5 February 1996)

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Big Game Development Company Botswana (Pty) Ltd and Another v De Kock and Another (civil Appeal No. 21 of 1995) [1996] BWCA 27; [1996] B.L.R. 145 (CA) (5 February 1996)

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1
IN THE COURT OF APPEAL OF BOTSWANA HELD AT LOBATSE
COURT OF APPEAL
CIVIL APPEAL NO. 21 OF 1995
(HIGH COURT MISCA NO. 232/94)
In the matter between:
BIG GAME DEVELOPMENT COMPANY
BOTSWANA (PTY) LTD       FIRST APPLICANT/APPELLANT
SAMUEL RICHARD MARKRAM   SECOND APPLICANT/APPELLANT
AND
HAROLD DE KOCK   FIRST RESPONDENT
OTTO HOFFMAN     SECOND RESPONDENT
ADVOCATE LOTZ WITH HIM KEMP AND MR. T. RAMOKHUA FOR THE
APPELLANTS
ADVOCATE TUCHTEN FOR THE RESPONDENTS
JUDGMENT
CORAM: LORD N. WYLIE J.A. J.H. STEYN J.A. W.L.K. COWIE J.A.
WYLIE J.A.
This is an appeal against the Ruling of Aboagye J. on 20 June
1995 in which he dismissed with costs an application filed on 9th
August 1994 as a matter of urgency for an order inter alia in the
terms following:

"1. "That a Rule Nisi do hereby issue calling upon Respondents to show cause .... why an order should not be made in the following terms:

l.l That the First and Second Respondents be and are interdicted from taking occupation or possession in any manner whatsoever of the Farm known as Bartrex ....

1.1.3 That the First and Second Respondents be interdicted from entering onto the said farm or in any manner interfering with the Applicants' Rights to occupy the said Farm or any portions thereof pending the final

2
end and determination of this application..."
The application was heard and granted as prayed on the following
day 10, August 1994, and the order set out in terms of paragraph
1.1.3 above was made to operate as an interim order pending the
return day of the Rule Nisi. Subsequently, at the hearing of the
application on 9 May 1995, the said paragraph was amended by
consent to read:

That the First and Second Respondents be interdicted from physically interfering with the applicants' occupation of the said farm or any portion thereof pending the final end and determination of this application. Subject to the amended rule the Respondents should have reasonable access to the farm."

The background of events leading up to this application briefly
stated is as follows. On 21 May 1990 the first respondent, De
Kock, a company known as BARTREX (PTY) LTD and the First
Applicant/Appellant, represented by the second
applicant/appellant, MARKRAM, entered into an agreement whereby
DE KOCK ceded to the first applicant/appellant all his rights and
obligations under a lease which he held in respect of two
adjacent farms, being the lands in issue and which are known as
Bar Trek. The first applicant/appellants were to farm the lands
for a period of 50 years and in return DE KOCK was to receive 51%
shares in a company known as Bar Trek Ranches (Pty) Ltd and 21%
shares in the first applicant/appellant company. By letter dated
25 July 1994, written on behalf of De Kock and addressed to both
Bar Trek Ranches (Pty) Ltd and the first applicant/appellant De
Kock purported to cancel the agreement of 21 May 1990 for reasons
which do not require setting out for the purpose of these

3 proceedings. De Kock and the second respondent, Hoffman, who is De Kock's grandson, are alleged to have subsequently made overt attempts to repossess the farm but were prevented from doing so by one Van Tonder, said to be one of the directors of the first applicant/appellant company. It was, as I have said, as a result of those attempts that the application was filed as a matter or urgency.

The application was opposed by De Kock represented by one Erasmus
acting under a Power of Attorney. The founding affidavit in
support of the application was sworn by Markram on 4 August 1994
and the opposing affidavit was sworn by Erasmus on 2 September
1994, its contents being duly confirmed by De Kock. In the
founding affidavit Markram maintains that he was authorised to
bring the application on behalf of the first applicant/appellant
to which I shall hereinafter refer to as "the company", in terms
of a resolution of the Board of Directors held at Durban on 2 9
July 1994 in these terms:

"RESOLVED that an application be brought in the High Court of the Republic of Botswana to safeguard the company's occupation and possession of the farm known as BARTREK in Botswana and that all steps necessary be taken to do so.

RESOLVED that SAMUEL RICHARD MARKRAM is authorised to bring the application on behalf of the company and to depose to the founding affidavit."

Although in paragraph 8.2 Markram refers to a copy of the Resolution annexed thereto as being signed both by himself and Van Tonder it in fact bears to be subscribed by Markram alone. In paragraph 7.1 he asserts that the current directors of the

company were himself, Van Tonder and De Kock. Paragraphs 9.1. and 9.2 list 9 persons, including himself and Van Tonder as shareholders or persons designated to be shareholders of the company holding or designated to hold 79% of the shares, the remaining 21% being held or to be held by De Kock. The bringing of the application by Markram as authorised by the resolution had the support of these 9 shareholders, as evidenced by the signed statements annexed to the affidavit.

These critical assertions by Markram in the founding affidavit are directly challenged in the opposing affidavit sworn by Erasmus on behalf of De Kock. The contents of this affidavit are confirmed by De Kock in the affidavit sworn by him on 1 September 1994, in which he authorises Erasmus to act on his behalf.

The opposing affidavit indeed makes interesting reading,
paragraph 3.4 reads as follows:

"Neither the resolution to proceed to litigation, nor the authorization of the Second Applicant is valid in law, however. The meeting of the board of directors was held without proper notice to all directors. In particular, the First Respondent, who is admittedly a director of the First Applicant, was at no stage informed of the meeting which was to be held nor was he informed of the agenda for such meeting."

Notwithstanding the terms of this paragraph, Erasmus later states, at paragraph 9.1, that "neither the Second Applicant, Van Tonder nor the First Respondent have been duly elected and appointed as directors of the First Applicant." In this connection, I refer also to the terms of paragraph 9.5:

"In terms of the Articles of Association, annexure "EW3",

the first directors of the First Applicant were to be appointed by the subscribers to the memorandum of association. No such meeting was ever held and no such appointment has ever been made."

Finally, at paragraph 9.9.d. Erasmus has this to say.

"As no proper appointment of directors has ever taken place, it is my respectful submission that the Applicants do not have locus standi in these proceedings. This point will be raised in limine at the hearing of this matter."

I will deal later with this issue in greater detail, but suffice to say at this stage that the submission on locus standi advanced on the respondents behalf were sustained by the learned judge a quo, who held that neither Markram nor Van Tonder had been validly appointed directors in accordance with the provisions of article 65 of the Articles of Association of the company and their acting as de facto directors could not be validated by the provisions of Article 96, under reference is the decision of the House of Lords in MORRIS v. KANS5EN AND OTHERS (1946) E.R. 586 per Lord Simmonds at 590. His Lordship accordingly held that the resolution passed which purported to authorise Markram to bring the application was invalid.

I should add that the Court a quo further took the view that even if the directors had been competent to pass the Resolution the fact that it had been passed at a meeting of directors outside Botswana would in any event have rendered it invalid. This was an issue which was indeed raised by Erasmus in his founding affidavit. However, it was not in fact argued before the Court a quo and it was abandoned in argument before this Court by counsel for the Respondents.

6 On the day after the ruling was issued by Aboagye J. the Second Respondent Hoffman, accompanied by several other persons and on instructions on behalf of De Kock, entered into possession of the farm. It is alleged that the Farm Manager was obliged to leave, that the Company's vehicles and equipment were taken over, that the notice board erected by the company at the entrance to the farm was broken down and that the houses constructed on the farm were subsequently broken into and occupied. In light of these events the company made application on 5 October 1995 for a spoliation order against the same respondents, alleging that up until 21 June 1995 the Applicant Company was in possession of the farm. What was sought was an order against the respondents to vacate the farm and, if such order was not complied with, an order for the eviction of the respondents. The current position, as we have been informed, is that the respondents have consequent upon a subsequent Court Order in fact left the farm and the company is once again in their de facto possession.

In the spoliation proceedings Markram submitted a founding affidavit although he was not a party to those proceedings. As in the previous application, which is the subject of this appeal, the spoliation application was likewise opposed by the Respondents and they again challenged the applicant's entitlement to sue. Points in limine similar to those taken in the previous action were again taken. The applicant had no directors and could not apply for the relief sought - a spoliation order and reinstatement of the statues quo ante. Markram was not authorised to bring the application on behalf of the Company.

7 There are however material differences in the evidence adduced in the second application to that which was available in the first application which the learned judge a quo dismissed.

Soon after he had been served with the respondents answering affidavits - and a Counter-application - in September 1994, Markram instructed his attorney of record to make investigations in relation to the incorporation of the company and the latter^ one Tafa, personally conducted a search at the Registry of Companies specifically to ascertain whether any appointment of directors of the company had been effected. The file pertaining to the company could not be traced. He repeated his searches after the hearing but again failed to trace any records relating to the company. According to the affidavit sworn by Tafa it was not until 25 September 1995 that the files were found and he was able to uplift copies of documents including in particular Form 2 which contained the names of directors appointed on 9 May 1990. This was attached to the founding affidavit and marked "J". It discloses the names of S. Markram, H. De Kock, W. van Tonder and R.P.S. Sethantsho as well as two other names, and it was filed on 25 May 1990. There was also recovered Annexure K, the certificate of incorporation of the company, also dated 9 May 1990. Tafa also confirmed Markram's statement that the standard practice in this country was for attorneys instructed to incorporate a company to be nominated the subscribers but shortly thereafter to appoint others as the first directors.

There was also lodged an affidavit sworn by one Mothobi who in

May 1990 was in practice as an attorney under the name and style Ebrahim and Mothobi, attorneys and conveyancers, in Gaborone. He stated that it was he and his partner Ebrahim who attended to the incorporation of the company and that each of them were subscribers to the Memorandum and Articles of Association, copies of the relevant sections of which were annexed to the affidavit. They had each taken up 3000 shares of the 6000 shares which had to be allocated. From these documents, as well as from two share certificates each signed by De Kock and Sethantsho it is asserted by Tafa that it is clear that the steps taken to incorporate the company and to appoint the first directors had been proper and regular and in accordance with normal practice. Annexure J also shows that Sethantsho, as Secretary of the Company, had attended to compliance with the provisions of section 157(2) of the Companies Act. At the conclusion of the hearing in the second application Gaefele Ag. J. held that the applicant can apply for the relief sought and the deponent to the founding affidavit, Markram, had been duly authorised to bring the application on the applicant's behalf. The result was that it would proceed to a hearing of the merits. He observed that Mothobi's statement was vital for a proper determination of the matter, he and his partner, as subscribers, having appointed the first directors of the company as listed in annexure J.

Before coming to a consideration of the appeal on the grounds stated, the Court had to deal with two preliminary matters and reach a view upon them.

9
By notice under Court of Appeal Rule 23 the Respondents had given
notice of a preliminary objection to the hearing of the appeal.
Shortly stated, this was founded on the fact that the applicants
had instituted the subsequent proceedings to which I have already
referred. It was maintained that the relief sought in those
proceedings was substantially the same relief as claimed in the
proceedings which gave rise to the present appeal. It was
further maintained that by instituting these subsequent
proceedings, rather than simply asking this court for leave to
put up the additional evidence which proved successful before
Gaefele Ag.J., the appellants have in effect approbated or
acquiesced in the order by Aboagye J. which is now being
challenged on appeal. In their Heads of Argument in relation to
this preliminary objection the Respondents state in terms at head
1.6:

"The said conduct of the present appellants is unequivocal and inconsistent with an intention to appeal because, even if the appeal were to be successful, the appellants will not proceed with the case when it is remitted to the court a quo."

This assertion is repeated at Head 4.13.

"Even if the appellants were to succeed in this appeal, they do not truly intend to proceed with the first application and cannot succeed therein. The purpose of the first application was to prevent an alleged threatened spoliation. The appellants failed in their attempt to prevent the threatened spoliation and, in the second application, contend that a spoliation has taken place as a result of which they are entitled to relief. An interdict is not an appropriate remedy for past invasions of rights."

This last passage would appear to contradict the earlier assertion that the relief sought in both applications was

10 substantially the same. In these circumstances it is alleged that the real purpose in persisting with the appeal was to avoid, if possible, the adverse costs order made by Aboagye J.,having brought proceedings on evidence that was less than adequate.

Counsel for the Respondents submitted that the true nature of the relief sought in the first application was essentially similar to that sought in the second application and pointed a passage in Markram's replying affidavit where he states "All the applicants want is a Court Order that the status quo remain and that the Respondent do not take the law into their own hands."

We had no hesitation in concluding that the relief sought in the two applications was not substantially the same. Indeed they are entirely different. The relief sought in the second application was for a spoliation order. Having been deprived of its possession by the actions of Hoffman on 21 June 1995, the company seeks to be restored to is former position before the merits are considered - the thing spoliated has to be returned ante omnia. In the first application what was sought, in relation to which the appeal is taken, was a prohibitory interdict, the purpose of which is to prevent a person from committing a threatened wrong or from continuing an existing one. Likewise we had no hesitation in rejecting the submission that the appeal has been perempted by the institution of the second application. The applicant would be put in an impossible position if he had to choose between taking proper steps in relation to the invasion of his rights on 21 June 1995 and losing his appeal in relation

11 to the interdict proceedings, or accepting the invasion of his rights until the determination of the appeal before taking steps to obtain a spoliation order, a process which in any event is one which must be exercised expeditiously. It is however to be observed that there is no authority to state categorically that such an order cannot be sought if the applicant has allowed a year to elapse after the interruption of his possession occurred, nor could it be concluded that relief could not be refused on account of delay to an applicant who took proceedings within that time. It is a question of circumstances in each case, in which the court has a discretion. See JIVAN v. NATIONAL HOUSING COMMISSION (1977) 3 S.A. 890. For these reasons the court rejected the Respondent's preliminary objection.

The second preliminary issue which the Court had to consider was a motion by the appellants, notice of which was served on the respondents on 11 January 1996 that the record of proceedings in the second application be introduced as part of record of evidence on which this court is to decide the appeal.

In essence Aboagye J. found that no directors had ever been appointed to act for the company. The learned judge a quo, after considering the dicta in MORRIS v. KENSSEN AND OTHERS (1946) 1 ALL.E.R. 586 and certain other authorities concluded "I accordingly hold that the acts of the de facto directors of the 1st applicant are not validated by Article 96 since they did not hold their positions by appointment. For this reason I hold that the Resolution passed by them authorising the 2nd applicant to

12
bring this application is invalid."

It was submitted in support of the motion that the learned Judge a quo had been misled not only by statements of the respondents but also by their fraudulent withholding of material information. In particular information in annexure J. had been withheld by De Kock and by Sethantsho, who was the company secretary at the material time. I have already referred to some of the conflicting statements in the affidavit sworn by Erasmus, confirmed as I have said by De Kock.

Exhibit J is clearly critical. It shows that the persons listed therein were appointed directors of the company on 9 May 1990, including and in particular Markram, De Kock, Van Tonder and Sethantsho and it was signed, and filed on 25 May 1990, by Sethantsho as secretary of the company. Moreover, as late as 24 August 1994 both De Kock and Sethantsho signed two share certificates in respect of 3000 and 1740 shares respectively in favour of BIG GAME DEVELOPMENT (RSA) (PTY) LTD, clearly indicating that they were both directors of the company. They did not disclose this information and it is contended in the applicant's Heads of Argument in this connection that it was fraudulently withheld from the court a quo, which would otherwise have reached a very different conclusion. To expose this conduct was said to be the primary purpose of the motion.

It was accepted that the Court has power under Section 7 of the Court of Appeal Act, read with Section 12 (d) of the High Court

13
Act and Rule 27 of the Court of Appeal Rules to receive new
evidence and may grant a party leave to allege any facts
essential to the issue that have come to his knowledge after the
decision of the court below. The powers however should only be
exercised where special grounds exist and where it is clear that
unfair prejudice would not result and would enable the court to
do justice between the parties. It was submitted on behalf of
the respondents in paragraph 4.8 of the Respondent's Heads of
Argument that an applicant for such relief must show:
"4.8.1 a reasonably acceptable explanation why the evidence was not led at the trial;
4.8.2   that the evidence is of material importance in the case;
4.8.3   that the evidence would probably change the result in the case; and
4.8.4   that its admission would not prejudice the other side."

The explanation given in this instance was, it was submitted, wholly inadequate. The evidence in question was a public document and if Tafa had shown more diligence it should have been discovered earlier. He simply stated that he could not find it. When the shoe began to pinch he re-doubled his efforts and did find it. No details were given of the alleged efforts made to trace Mothobi although all along he was in Botswana. The other subscriber, Ebrahim, is not referred to at all. It is simply said he has gone abroad. It would, so it was submitted fundamentally subvert the normal course of justice if new evidence was to be admitted simply because it was cogent. In this instance prejudice would be sustained because the

14 respondents were not in a position to argue the correctness of the judgment of Gaefele Ag. J. As in the context of the preliminary objection it was submitted that the real purpose in seeking to lead further evidence, as in persisting with the appeal, was simply to avoid, if possible, the adverse costs order already made.

As in the case of the preliminary objection, the court took some time, although necessarily short, to consider this preliminary issue and reached the conclusion that, in the particular circumstances of this case, the record of proceedings in the second application should be introduced as part of the record on which the appeal is to be decided in view of the fact that in its opinion all the requirements aforesaid had been established.

I turn now to consider the merits of the appeal. I do so in the first instance at least on the basis of the evidence which was actually before the learned judge a quo and on which he based his decision so far as it relates to the first applicant/appellant. 3. The grounds of appeal are as follows:

3.1.1

In failing to find that the First and Second Appellants had the necessary locus standi and were before the Court.

3.1.2

In finding that no appointment or purported appointment of directors of the First Appellant was made or alleged.

3.1.3

In not taking into account that the First Resolution was ratified by a subsequent meeting of directors held in Botswana.

3.1.4

In finding that the First Respondent alleges that he is in possession of the farm.
3.1.5

In failing to find that the First and Second

15
Appellants were in possession of the farm.

In finding that the Second Appellant did not have a financial interest in the farm.

In failing to find that the shares in the First Appellant were issued.

In failing to find that the Appellants were not aware of any defects in the appointment of directors if any, when Markram was authorised to act.

In failing to find that The First Appellant was in fact before the Court.

In failing to find that the Appellants resisted on the papers the averment that there was no valid first appointment of directors.

By equating the persons who authorised the bringing of the application by First Appellant with strangers.

In failing to find that the First Respondent was estopped from relying on the lack of locus standi of Markram and Van Tonder.

The learned Judge a quo erred on issues of law in the following respects:

In finding that the meetings of the directors of the First Appellant can only validly be held in Botswana and that this affected the point in limine;

In finding that the non-appointment of directors by subscribers to the Memorandum of Association made any subsequent appointments of directors invalid;

In finding that the acts by the persons who acted as directors do not fall within the provisions of Article 96 of the Articles of Association or the provision of Section 140 of the Companies Act;

In failing to recognise Markram's rights in terms of Section 140 of the Companies Act to safeguard the First Applicant's position;

In failing to interpret the articles as widely as possible to give business efficacy thereto;
6

In finding that no directors were appointed;
7 In finding that the Resolution on 29 July 1994

16
was invalid and not ratified by the Resolution of 29 April 1995;

In finding that the application is not properly before the Court;

In failing to apply the proper test in respect of the resolution of the disputing on which the point in limine rested, such being decided on First Respondent's request on the papers;

In not referring the matter to oral evidence in respect of the disputed items of fact regarding the appointment of the directors of the First Appellant insofar as such were necessary to deal with the point in limine;

By making a cost order against a party which if the judgment was correct was not a party to the proceedings namely, the First Appellant and without considering the proper cost Order to be made against the Second Appellant in such event;

By finding that it was unnecessary to determine whether the application had the support of the shareholders on interested parties in the First Appellant;

By confusing with respect, in respect of the Second Appellant, the allegations regarding the merits of the case, namely whether he was in possession, which if disputed could not be argued on the papers, with the question of his locus standi;

By failing to apply the proper test as to the First Appellant's locus standi, namely, whether the First Applicant was in fact before the Court;

By failing to establish the Second Appellant's locus standi by virtue of his allegations on the papers;

By making findings in the merits of the application without this being placed properly before him;

By refusing to accede to the First Appellant's request that in the event of a finding that the bringing of the proceedings have not been properly authorised, to adjourn the matter to enable the First Appellant to redress the lack of authority.

The relief sought from the Court of Appeal is for an Order in the following terms:-

17
4.1 The appeal is allowed with costs;
4.2 The decision of the Court a quo is set aside and an Order is made on the following terms:-

4.2.1

The objection in limine is dismissed with costs;

4.2.2

The Rule Nisi as granted on the 10th August 1994 is extended to the date of hearing of the application;

4.2.3. Further or alternative relief.

What was raised as a point in limine by the Respondents, was that the First Applicant was not actually before the Court because MARKRAM (Second Applicant), the deponent and person bringing the application on behalf of the First Applicant, did not have the necessary locus standi to do so because he and VAN TONDER were not duly appointed by the subscribers to the memorandum of the First Applicant as directors and as such had no authority to bring or authorise the proceedings, nor did they have authority on any other basis. This was the only aspect raised by the point in limine and the only issue addressed in argument by both sides in respect of the application. The Court a quo upheld the Respondents' point regarding lack of authority due to absence of a proper appointment.

The first and critical comment I have to make is that the challenge to the directors' locus standi rests on the hearsay allegation of Erasmus. He was not involved in the affairs of the company at the stage of the appointment of the directors by the subscribers and had no personal knowledge of the regularity of such appointments. No source for his belief was mentioned and

18 who advised him remained a mystery; a general prerequisite for attaching weight to hearsay allegations is an affidavit. Nor has he indicated why he was unable to provide an affidavit from his source. It seems to me that, in a situation where the directors in question acted as such with the full knowledge and support of the Respondents for a period of four years, more than a hearsay allegation that the subscribers did not make any appointment would be required.

It is to be noted that Erasmus receives no support from Sethantsho, who was the secretary of the company at the time, and he does not deal with the point in limine at all. As company secretary he would have had the duty to see to it that names of all duly appointed directors were provided to the Registrar of Companies and a presumption arises that BIG GAME DEVELOPMENT COMPANY (BOTSWANA) (PTY) LIMITED was in fact properly incorporated as such and that the subscribers to the Articles of Association would, in accordance with the Articles of Association themselves and indeed in their own personal interests, proceed to appoint the first actual directors with reasonable expedition.

The fact is that the company functioned as a legal entity, a corporate structure was created and it acted through its purported directors, in particular Markram, Van Tonder and De Kock. Meetings were held in Botswana and Minutes were kept. This state of affairs, with these three persons acting as directors and later as sole directors endured over a lengthy period of almost 4 years. At all times they were supported and

19 accepted as directors by every person who may have had an interest in the company. They certainly regarded themselves as duly appointed directors, and acted openly as such. At no time until these proceedings were initiated was it ever suggested, by De Kock who acted alongside Markram and Van Tonder as a director, or by anyone else, including the subscribers themselves, that the position was otherwise.

In these circumstances, having regard to the totality of the whole situation, it does not lie in the mouth of De Kock to raise any question of lack of proper appointment at this late stage. The probabilities of the situation are in my view clearly such that the subscribers did in fact appoint the first directors to take over responsibility for the company and manage its affairs.

Now the only evidence which refutes the probabilities of the situation is the hearsay evidence of Erasmus, who had no connection with the company at the material time in May 1990, and who declined to disclose the source of his information. Accordingly, apart from the "in any event" argument that they were de facto directors, I am satisfied that the proper inference to be drawn from the evidence before the learned judge a quo was that these three persons were in fact duly appointed by the subscribers as the first actual directors of the company. The purported challenge to the applicant's locus standi was based on a hearsay allegation, made by someone who, had no connection with the Company at the time, and flies in the face of all the probabilities.

I turn finally to the second applicant/appellant's appeal against the finding by the learned judge a quo that Markram was not in possession of the house which he claims to have built and to occupy. This issue is focused in ground of appeal 3.1.3 "in failing to find that the First and Second Appellants were in possession of the farm "and in ground 3.1.13, already referred to.

The reasoning of the learned judge a quo in this connection is
to be found in the concluding paragraphs of the Ruling.

"He alleges to have erected one of four houses in the farm with the consent of the 1st applicant (who is said to be in possession of the farm) to be used by himself mainly and by his guests. The said house was at the time of filing this application occupied by his guests. He, therefore, by this application, seeks an order of this court to protect his possession of his house.

The 2nd applicant's allegations that the 1st applicant is in possession of the farm and that he himself is in possession of a house built by him in it are denied by the 1st respondent who claims to be the only person in lawful possession of the farm.

An applicant seeking a spoliation order must prove that he was in possession and also that he was ousted illicitly from possession. A person whose lawful possession is threatened is entitled to protection from the court. The question in this case, however, is, "has the 2nd applicant established that he is in possession of any house lawfully built by him in the farm?. On the affidavits, I will say no. He gave his address in the founding affidavit as 297 Phala Road, Amazimtoti, Kwazulu-Natal, Republic of South Africa. None of the alleged guests of his has been named and there has been no disclosure of what they are doing on the farm. There is no proof of any sort of his having built a house in the farm at his own expense and I cannot just accept his bare assertion as proof.

In the absence of any proof that the 2nd respondent is in possession of a portion of the farm he cannot claim any order for protection from this court."

In their Heads of Argument the Respondents support this reasoning to the effect that the factual material put up by the second appellant was insufficient to support a cause of action.

The contention that the company was not in physical possession and control of the farm up until 21 June 1995 cannot be reconciled with the terms of the letter dated 25 July 1994, which triggered the application for Interdict, the dismissal of which as 20 June 1995 is the subject of this appeal.

"It is our express instructions that your clients and/or any other persons who occupy the premises on their behalf, vacate the farm on or before Monday the 1st August 1994, failing which the gates will be locked, in accordance with our clients right to do so under those circumstances."

A copy of the letter cancelling the agreement of 21 May 1990 was enclosed as apparently had been requested by the company. This letter in my view cannot be construed as anything other than an acknowledgment of the company's physical possession and control over the lands in dispute. It will be recalled that there was a farm manager as well as others on the farm and that it was Van Tonder who had initially prevented Hoffman taking unilateral steps to take over the farm. In my view, on the evidence adduced, it is impossible to hold that the company was not in de facto physical occupation at that time.

The second appellant's case is that he had erected a house, which was one of four houses constructed on the farm, to be utilised by himself and that he was possession of that house. Houses were

erected in terms of an agreement reached "for the purposes of accommodation of visitors to the farm", which houses were to form assets of the company notwithstanding that the costs of erection would not be the responsibility of the company. The existence of this agreement in terms of which Markram erected the house, were known to and acknowledged by the Respondents, although they denied its legality.

The position taken up by the Respondents is set out in their
Heads of Argument as follows:

"9.3 Possession requires effective physical control or custody of the thing in question. Physical control over a building is exercised by the person who occupies it or who holds the key to the building.

9.4

It is not even alleged that there exists a key to the house in question.

9.5

The question is therefore whether the second appellant possesses the house through his guests.

9.6

The second appellant does not disclose who his guests are, on what terms and for how long they occupy the house.

9.7

It might perhaps be legitimately inferred, the house in question being on a game farm, that the guests in question arrive for holidays of relatively short duration and then leave and that there are period during which the house stands vacant, ie is not occupied by either the second appellant or any of his guests.

9.8

It is not the second appellant's case that he occupies through an employee or agent.

9.9 The second appellant alleges that his guests hold the house on his behalf. In so alleging, the second appellant is wrong in law. The guests of the second appellant: when in residence guests occupy the house as principals and the second applicant parts with such possession as he may have had over the house to such guests.

In my view there is no substance in any of these contentions. The agreement to which I have referred and to which incidentally De Kock was a party, clearly envisaged that the houses would be occupied, not only by the members of the company who erected them, together with their immediate family and friends, but could be rented out to hunters and/or tariff paying visitors. I have accordingly, on this aspect of the appeal, reached the conclusion that the learned judge a quo was not justified in holding that the second applicant/appellant was not in possession of this property. Having reached that conclusion it is not necessary to go into the alternative claim to a lien for improvements.

On the whole matter I would allow the appeal with costs, set aside the decision of the Court a quo and pronounce an Order that the Rule Nisi as granted on 10 August 1994 be extended to the date of the hearing of the application.

_5^th
Delivered in open court on the day of February, 1996
LORD N. WYLIE JUDGE OF APPEAL

,'**

I agree.
J.H..STEYN JUDGE OF APPEAL

I agree,
LORD W.I.K. COWIE JUDGE OF APPEAL

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